proxima helps activision blizzard create value and achieve sourcing success

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www.proximagroup.com Proxima helps Activision Blizzard create value and achieve sourcing success Bertrand Leroux, Activision Blizzard John Mathew, Proxima © Proxima 2013. All rights reserved.

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==To access the full presentation click here http://insight.proximagroup.com/proxima-helps-activision-blizzard-achieve-sourcing-success == The video game industry is global, dynamic and ever changing. Developing and marketing of a video game on a worldwide scale can be an expensive proposition. Engaging the right partners and suppliers is crucial for success. No one knows this better than Activision Blizzard, one of the world’s largest and most successful video game developers known for franchises like Call of Duty and Guitar Hero. With pressure to control costs mounting, Activision Blizzard turned to Proxima in 2012 to better manage costs, supplier and partner relationships and sourcing efforts more efficiently. And in just over a year, the partnership yielded significant savings to the business. Activision Blizzard’s Bertrand Leroux, CIO and Head of Global Strategic Sourcing and Proxima’s John Mathew, Client Services Leader, jointly discuss the drivers behind the Activision Blizzard’s sourcing success. In this presentation you will learn: * Hear lessons learned from building a sourcing function in a highly creative no-mandate environment * Understand how the sourcing organization has enabled rather than hindered success * Learn what the wider business impact has been on Activision Blizzard

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Page 1: Proxima helps Activision Blizzard create value and achieve sourcing success

www.proximagroup.com

Proxima helps Activision Blizzard create value and achieve sourcing success

Bertrand Leroux, Activision BlizzardJohn Mathew, Proxima

© Proxima 2013. All rights reserved.

Page 2: Proxima helps Activision Blizzard create value and achieve sourcing success

www.proximagroup.com2

About Activision Blizzard

The company Activision Blizzard is a leading publisher of video games and a distributor of interactive entertainment

Revenue $4 billion+ in Calendar 2012

Employees 7,000+

Ticker “ATVI”

Did you know? Call of Duty has been one of the most significant entertainment events of each of the last six years. Call of Duty Black Ops 2 grossed $1b in worldwide retail sales in 15 days"

Total sales for the Call of Duty franchise have exceeded worldwide box office receipts for “Harry Potter” and “Star Wars” – the two most successful movie franchises of all time

Page 3: Proxima helps Activision Blizzard create value and achieve sourcing success

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Proxima / Activision engagement

Engagement scope

Activision Blizzard selected Proxima in 2012 under a multi-year engagement to provide:• Strategic sourcing• On site change management• Category expertise• Sourcing administration support for indirect spend

Major areas of indirect spend

• Marketing • Video production• Media• POS• HR• Information technology• Professional services

Page 4: Proxima helps Activision Blizzard create value and achieve sourcing success

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Aims: What will you get from this session

Hear lessons learned from building a sourcing function in a highly creative no-mandate

environment

Understand how the sourcing organization has enabled rather than hindered success

Learn what the wider business impact has been on Activision Blizzard

Page 5: Proxima helps Activision Blizzard create value and achieve sourcing success

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Environment before transformation

1. Spend/ categories influenced was small2. Responsibility for sourcing sat with managers along with day job

1. No systematic approach to reap innovation from suppliers2. Little involvement in business planning led to increases

1. Inappropriate suppliers used for operationally critical services2. Inability to ensure supplier delivered contracted business outcomes and savings

1. Limited spend data visibility and analytics2. Lack of information in place to track and trap requirements

Commercial

Measurement/Control

Technology Innovation

Page 6: Proxima helps Activision Blizzard create value and achieve sourcing success

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Drivers for sourcing transformation

1. Evolution of gaming industry and price points require quicker reaction time2. Digital impact on gaming business 3. Integration commitments

1. Cost management a key aspect of culture2. Improve supplier costs and service levels3. Free up valuable resources in Marketing, IT and HR to focus back to core functions

1. Management saw significant opportunities for improvement, in both financial and non-financial terms

1. In order to maximize value, company adopted a centralized structure2. Management recognized collaboration with stakeholders as key to long term success

External pressures

Opportunity

Organization impact Internal pressures

Page 7: Proxima helps Activision Blizzard create value and achieve sourcing success

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2013

2014+

2012

• Sourcing viewed as a trusted business partner aligned with BU success

• Protection and enhancement of the reduced cost base

• Openly seeking innovation from suppliers

• Professional category management approach through engaging sourcing

• Suppliers become allies

Activision Blizzard target state

Extending sourcing’s influence:

Into new categories

Across geographic borders

Across business units

Across functions

• Significant savings delivered and taken to the bottom line

• Balance of power shifted from suppliers to Activision Blizzard

• Sourcing activity devolved across business units

• Undertaken in an inconsistent manner

• Limited efforts to consolidate or leverage spend

• Loss of value

Page 8: Proxima helps Activision Blizzard create value and achieve sourcing success

www.proximagroup.com

To view how the challenge was answered and the resultsclick here

© Proxima 2013. All rights reserved.